Atlanta Journal Constitution Op-Ed: Corporate Tax Credit Program Fails California

In today’s Atlanta Journal Constitution, California Labor Federation’s Art Pulaski warns Georgia not to repeat the same mistakes California’s made with our failed enterprise zone program. In an op-ed titled “Tax credit program fails California,” Pulaski highlights the myriad of problems with the California enterprise zone program, which has morphed into a $700 million annual drain on taxpayers, taking resources away from much-needed investments in infrastructure, education and health care while doing little to create new jobs.

From the Atlanta Journal Constitution op-ed:

In theory, tax credits for businesses to create jobs are positive. They can help businesses stay competitive and strengthen communities. But what tax breaks do in practice is another story entirely, as we in California know well.

There are many similarities between Georgia’s opportunity zone program and California’s enterprise zone program.

Both programs were designed to boost jobs in low-income, high-unemployment areas. To Georgia’s credit, the opportunity zone program has some standards California’s lacks, like a requirement that companies create net new jobs to obtain the credit. Without proper accountability, wage standards and transparency, these types of tax credits can become wasteful government spending that does little to nothing to lift up economically disadvantaged communities.

Politicians love tax credits that go to their districts. That doesn’t mean those tax credits are good for constituents or for the state. California’s enterprise zone program is a $700 million annual drain on taxpayers that provides little if any positive impact to the economy.

Read the full op-ed.

To combat these abuses, the California Labor Federation is sponsoring SB 434 (Hill) to reform California’s enterprise zone program so that it’s more transparent and accountable to its intended purpose of creating jobs.

Learn more about enterprise zones and SB 434.